- Analyst Vivian Hao, who has cut shares to Sell and lowered her PT to $2.40, isn't pleased with Renren's (RENN -3.5%) Q2 revenue miss and Q3 guidance, which the company attributed to online/mobile game delays.
- She also notes Renren's ad revenue is stagnating thanks to a shortage of inventory (social networking share losses to Sina/Tencent could be a reason for this), that opex continues to jump thanks to investments in the Nuomi group buy/daily deals unit (Baidu is reportedly interested in it), and that PC-related revenue is being hurt by the mobile shift.
- Nuomi revenue rose 22% Q/Q and 69% Y/Y in Q2, but was still only $6.2M. Active paying users +700K Q/Q to 3.8M.
- Renren's online ad revenue only rose 2.4% Y/Y to $15.4M, and game revenue only 1.4% to $22.8M. Other Internet value-added service revenue +43.5% to $5.2M (thanks to the Woxiu virtual talent show service).
- Jefferies cut Renren to Underperform yesterday, while citing concerns about strong online game competition (from Tencent, Qihoo, and Baidu) and slow mobile ad monetization (even though mobile is now 77% of traffic). The firm also notes Nuomi is estimated to have held only 11.6% of the Chinese group buy market in June (Meituan led with 36.5%).
Renren adds to post-earnings losses following Deutsche downgrade
Aug 16 2013, 16:52 ET